...Russia is still a major weapons provider for Azerbaijan, but the Israelis are now selling it large amounts of weapons and appear to be using it as a base from which to observe and, according to rumors, possibly attack Iran. Russia, which supports Armenia, a country Azerbaijan fought a war with in the late 1980s and early 1990s and technically still is at war with, ought to oppose Israel's action, particularly since it threatens Iran, which Russia does not want attacked. At the same time, Russia doesn't feel threatened by Israeli involvement in Azerbaijan, and Israel doesn't really care about Armenia. Both are there, both are involved and both think Azerbaijan is important, yet each operates in ways that ought to conflict but don't.
Putin's Visit and Israeli-Russian Relations | George Friedman, Stratfor